The Chesapeake City Council held a work session at 5:00 p.m. followed by a regular meeting at 6:30 p.m. on April 21, 2026, in the City Hall Council Chamber. The work session focused on data center regulations and the FY2027 operating budget and capital improvement program. The regular meeting included proclamations for Earth Day and Building Safety Month, public hearings on four planning items, and a closed meeting for real estate negotiations. Eight council members were present; Vice Mayor Ritter was excused.
Welcome everyone. It is April twenty first, twenty twenty six, and Mr. Manager, you are ready to get us informed about a data centers and budget, correct? Yes, sir. Thank you, Mr. Mayor. So I'm going to immediately turn it over to uh Jimmy McNamara in the planning department and also Stephen Wright in economic development to talk about some of the issues related to data centers. Good evening, everyone, and appreciate your time this uh this evening. Uh with me today I also have Alyssa Neal, who is our subject matter expert and is handling the text amendment change for data centers, which we'll be going over here through the presentation. So last year the city did receive a request uh for a piece of property for the purpose of constructing uh a data center. The public hearing for that item resulted in hours of discussion. Ultimately, the rezoning was denied. And shortly thereafter, in the fall of 2025 at City City Council retreat, we again discussed the benefits and challenges of data centers. So on January 13th of this year, City Council adopted an initiating resolution directing staff to begin work on preparing amendments to the zoning ordinance to address data centers. So we will be giving you an overall update on the progress towards that goal. We'll explain the existing status of data centers within the city and where we are currently where they are currently permitted. Um we'll talk about our approach to this text amendment, preliminary considerations for standards, and then discuss next steps. And finally, uh Stephen will take things over and we'll go over a proposed tax adjustment from uh from economic development. SARS zoning ordinance currently uses the standard industrial classification manual to classify uses, and data centers as they exist today were not necessarily contemplated in the 1987 uh update when the manual was developed. Uh the existing code that this use falls under is 7374, which is computer processing and data preparation and processing services. Uh similar use uh that we see this is is is an office environment or a call center, not necessarily the data centers that we see today. The SIC code is a permitted use in business, industrial, and office zoning districts, uh, meaning that this is a by-right use without the need for any city council approval in these locations. It is also permitted by right in the Great Bridge and South Norfolk uh overlay districts. When looking at properties with this zoning classification, that means there are over 27,000 residentially zoned properties that lie within 500 feet of a property that permits a data center by right. At the time of the retreat, we recommended several actions to consider. First, make these a conditional use on property zone industrial or within the Fentrest Airfield Overlay District. Next, we recommended the adoption of a policy similar to that of the solar energy policy that would guide staff recommendations when applications were being considered. And finally, we recommend that data centers continue to be permitted by right on the Coastal Virginia Commerce Park. The development criteria for this park has extensive requirements already in place that would also apply to data centers. Our approach to this topic was is extensive. We knew that it was absolutely critical to engage with stakeholders who are both pro and anti-data centers. We knew that we had to engage with those in tangential uh industries like Dominion Energy and the Virginia Natural Gas. We knew that we had to work with other city departments to make sure that their concerns were addressed. We also knew that state code is constantly changing and that we need to incorporate the latest changes uh as adopted by the General Assembly. And we know that there's been a lot of work that's been done regarding data center regulations across the state. We set out to engage with expert localities and to review applicable ordinances from across the state. When looking for expert localities, we didn't have to go far. In February of this year, we load up a van full of city departments, uh, department uh representatives and planning commissioners and headed up to Prince William County. We were able to sit down with a variety of their experts and staff and discuss the nuts and bolts of their regulations. We heard what they did well, uh, what they needed to make where they needed to make changes and lessons learned along the way. We are also able to go on a site tour where we saw both newer and older model data centers. We saw some under construction, we saw single and multi-story, and we saw many, many substations. We saw buildings that look like office buildings. We stopped at one particular data center and got out to listen to the noise generated uh by that data center. This one was located less than 200 feet away from multifamily residential units. Try as we did, we did heard no noise at all. At one point, I asked if the data center was actually operational yet. From an audible noise perspective, no noise was observable. That being said, we also know that much of the noises generated from these facilities is a noise that you cannot, quote, feel, but you he that you feel rather than hear. We also stopped in another neighborhood for a separate facility that where the county has received several complaints.